Public Service Motivation,Performance-Contingent Pay,and Job Satisfaction of Street-Level Bureaucrats

Abstract

Does job satisfaction of street-level bureaucrats depend on intrinsic public service motivation (PSM) or extrinsic performance-contingent pay? Which factor exerts a more substantial impact on job satisfaction? Drawing on a data set of 220 frontline public service workers in Hong Kong, this study examines the nuanced relationship among PSM, performance-contingent pay, and job satisfaction. The findings show that both PSM and performance-contingent pay elevate the job satisfaction of street-level bureaucrats through a shared mediator-perceived job control. Furthermore, PSM, as an intrinsic motivator, exerts a stronger impact on job satisfaction than performance-contingent pay.

Keywords

public service motivation performance-contingent pay perceived job control job satisfaction street-level bureaucrats in Hong Kong

Introduction

Street-level bureaucrats are public service workers, such as police officers, social workers, teachers, and physicians, who implement public policies and interact directly with the public in service encounters (Lipsky, 2010). While their work is essential for ensuring the quality of public service delivery, street-level bureaucrats often face daunting tasks that involve managing divergent expectations from multiple stakeholders (Brodkin, 2011; Hupe & Buffat, 2014; Tu & Gong, 2022). Moreover, they are required to be fully engaged, suppress negative emotions, and consistently display desirable emotions, leading to exhaustion and reduced job satisfaction (JS; Diefendorff et al., 2011). This phenomenon is not to be taken lightly, as the JS of individual street-level bureaucrats has a direct impact on their work morale and earnestness in implementing public policies and delivering services to citizens (Petrovsky et al., 2023).

Performance-contingent pay (PCP) and public service motivation (PSM) are two crucial determinants of JS among street-level bureaucrats (Buurman & Dur, 2012; Shim et al., 2017). With the advent of New Public Management, PCP has been increasingly adopted in the public sector to motivate civil servants (Perry et al., 2009). As a typical extrinsic incentive, PCP stimulates individuals’ extrinsic motivation by closely linking their performance with the prospect of instrumental gains, such as money, praise, and fame. By providing tangible rewards for employees’ productivity, PCP is anticipated to heighten their sense of belonging, self-esteem, and commitment (Heywood & Wei, 2006; Lazear, 2000). Noteworthily, a large body of literature sheds light on the PSM construct in the public sector, which can be seen as a counterweight to the standard economics positing civil servants as self-interested agents (Anderfuhren-Biget et al., 2010; Ritz et al., 2016). PSM is referred to as a significant intrinsic pro-social inclination arising from public institutions and missions (Perry et al., 2010). It is considered a significant predictor of public employees’ JS, as it mirrors the values and preferences upheld by the public sector (Vandenabeele, 2009).

While both PSM and PCP can positively impact JS, the existing literature primarily focuses on the crowding-out effect of PCP on PSM (Bellé, 2015; Weibel et al., 2010). The crowding-out effect derived from cognitive evaluation theory (CET) depicts the undermining impact of extrinsic incentives on intrinsic motivation (Cerasoli et al., 2014; Frey & Jegen, 2001). PCP is a typical extrinsic incentive, while PSM is normally considered an intrinsic motivation grounded in the public sector (Corduneanu et al., 2020). Following the crowding-out effect, PCP may be interpreted by recipients as a controller of their behavior, thereby potentially eroding their intrinsic motives (Deci et al., 1999). As a result, PCP may undermine PSM among public sector employees, exerting no positive net effect on JS or other desirable job-related outcomes (Chenhall & Langfield-Smith, 2003; Weibel et al., 2010).

However, several questions remain unaddressed in the literature. To begin with, whether PSM and PCP work in tandem in enhancing JS is still unknown. Besides, is JS more susceptible to PSM than PCP in the public sector or the other way around? What serves as the mediator in the impact of PCP and PSM on JS? Given that PSM and PCP frequently coexist as individual attributes and organizational arrangements within the public sector, it becomes crucial to elucidate the mechanisms and degree to which these factors influence the JS of frontline governmental workers. The current fixation on the crowding-out effect of contingent pay on PSM may inadvertently overlook not only the multifaceted psychological and material needs of street-level bureaucrats but also other important variables mediating or moderating the interplay among PSM, PCP, and JS. Put differently, the established literature may fail to recognize that one’s JS is not simply determined by PSM or PCP alone: To a considerable degree, both intrinsic and extrinsic motives matter in ultimately deciding one’s JS. Consequently, it is imperative for this study to delve into the pathway that elucidates how PCP and PSM impact JS.

Specifically, this study suggests that PSM and PCP—through the mediating variable of perceived job control (PJC)—act in synergy to enhance civil servants’ JS. PJC refers to employees’ level of autonomy and decision-making power over their work tasks and environment (Karasek, 1979), which is considered a fundamental psychological need according to the CET (Sheldon & Gunz, 2009; Van den Broeck et al., 2016). The relationship between work characteristics and JS has been demonstrated to be significantly mediated by PJC (Bakker et al., 2007; Karasek, 1979; Parker et al., 2010). Investigating PJC as a mediating variable is therefore crucial for gaining insight into the underlying mechanisms by which internal and external incentives influence JS.

Notably, both PSM and PCP can help increase street-level bureaucrats’ PJC, thus boosting their JS. Street-level bureaucrats with higher PSM are likely to feel a stronger sense of control over their careers given that their values and preferences align more closely with those held in the public sector (Bright, 2007; Vandenabeele, 2008). PCP may promote PJC by clearly stating primary working goals and signaling an appreciation for competence (Eisenberger et al., 1999; Houlfort et al., 2002).

To empirically explore how PSM and PCP impact JS through PJC, this study uses street-level bureaucrats in Hong Kong as a case. A survey was administered among 220 frontline public service workers in Hong Kong in 2021. Theoretically, this research contributes to the body of studies on the impacts of PCP and PSM on JS (Bellé, 2015; Deci et al., 1999; Frey & Jegen, 2001; Weibel et al., 2010). Methodologically, structural equation models are employed to unveil the intricate mechanisms that underlie the interaction among contingent pay, PSM, PJC, and JS. Different from the established studies pivoting around the crowding-out effects of PCP on PSM, this research argues that their impact on JS ought to be simultaneously considered. By identifying an important common mediator, namely the level of job control at the perceptual level, this study suggests that both extrinsic contingent pay and intrinsic PSM can help increase the JS of street-level bureaucrats. Practically, understanding the impact of PSM and PCP on JS is crucial in developing effective incentive systems in the public sector. Comprehending which factor has a greater influence on job performance can assist policymakers and managers in designing more-efficient performance management systems that maximize the motivation and performance of public servants.

Analytical Framework and Hypotheses

This study suggests that PSM and PCP are two fundamental factors in influencing the JS of public sector employees. PCP serves as an external incentive, fulfilling employees’ material needs and motivating them accordingly. Conversely, PSM represents an intrinsic motivation, addressing public sector workers’ psychological demands and incentivizing them through internal factors. That is, PSM and PCP can join forces to promote JS. Furthermore, PJC mediates the impacts of both PSM and PCP on JS. The overarching theoretical framework is then made of four factors: PSM, PCP, PJC, and JS. Figure 1 shows these elements in the framework and their direct and indirect effects on JS. In subsequent sections, this article first analyzes the impact of PJC on JS and then explores how PSM and PCP affect JS directly and indirectly via PJC.

Figure 1.

Overarching Analytical Framework.

PSM and JS

PSM is characterized as altruistic or pro-social intentions to serve the interests of a community of people, a state, or humankind (Bright, 2008; Perry et al., 2010). In the public sector, PSM is considered a distinct characteristic of public employees who are less driven by extrinsic incentives and care more about the public interest than their private sector counterparts (Bozeman & Su, 2015; Houston, 2000; Rainey & Bozeman, 2000). Individuals with higher PSM are believed as being more inherently attracted to the public sector that promotes public interests (Clerkin & Coggburn, 2012; Lewis & Frank, 2002). Naturally, they are also more likely to support the service mission and objectives of public organizations charged with delivering public goods and services (Vandenabeele, 2008).

Extant research also considers that a positive relationship between PSM and JS is especially pronounced in public organizations because public sector employment helps satisfy individuals’ pro-social needs (Stefurak et al., 2020; Vandenabeele, 2009). As noted by Andersen and Kjeldsen (2013), individuals with elevated levels of PSM might find it easier to actualize their pro-social motivation within the public sector. This is attributed to the fact that public organizations are uniquely positioned to offer their employees increased opportunities for contributing to public goods and serving the public interest compared with the private sector. Furthermore, the better aligned an individual’s attitudes, values, and preferences with those of the organization, the higher the JS likely to be attained (Kristof-Brown et al., 2005). Simply put, individuals with a higher level of PSM may feel more compatible with the values and objectives embedded in public organizations, resulting in enhanced JS (Bright, 2007; Kim, 2012).

PSM especially serves as a pivotal factor contributing to JS among street-level bureaucrats who need to engage in face-to-face encounters with the public. It is well documented by scholarly work on street-level bureaucracy that direct interactions with clients place high emotional demands on employees (Cho & Song, 2017; Hsieh, 2014). The experience of close contact with clients is often fraught with conflicts and tensions arising from unpleasant communication, contradictory expectations, or limited resources (Grandey & Diamond, 2010). Under such a demanding environment, it becomes challenging to induce JS among street-level bureaucrats if their motivation for serving the public is not sufficiently steadfast to overcome the predicaments at work (Wen et al., 2020; Zvobgo et al., 2022). Imaginably, highly motivated public servants are more likely to deal with their job demands with ease and prevent exhaustion (Bakker, 2015; Mussagulova, 2021). This study, therefore, postulates that:

Hypothesis 1 (H1): Street-level bureaucrats with a higher level of PSM will have higher JS.

PCP and JS

A large body of studies has examined the impacts of PCP on JS. PCP directly links individual or organizational attainment of performance goals to tangible financial rewards (Boachie-Mensah & Dogbe, 2011). It can be seen as an instrument for achieving competitive advantage and as a reflection of the norm of equity (Heywood & Wei, 2006). Incorporating principles from standard economics and behavioral management theories, a line of research portrays humans as rational actors driven by extrinsic motivations. This perspective suggests that PCP could enhance individual performance when implemented effectively (Lazear, 2000; Paarsch & Shearer, 2000). Brown and Sessions (2003) suggest that workers prefer an employment environment that rewards their productivity because contingent rewards are tangible recognition of their hard work and are bound to increase their optimism about future employment prospects.

Besides possessing instrumental attributes, PCP provides meaningful, positive informational feedback regarding self-competence in a context where a person has certain autonomy in coping with their tasks (Eisenberger & Aselage, 2009; Eisenberger et al., 1999). That is, by conveying “competence valuation” in terms of accomplishment of organizational goals, PCP affords employees the possibility of experiencing self-efficacys in performing tasks and thus produces a net gain in satisfaction (Fang & Gerhart, 2012; Grandey et al., 2013). In the literature, employers’ use of performance pay schemes has indeed proven to create greater feelings of belonging, esteem, and satisfaction (Stazyk, 2013; Tu, 2022). This study, therefore, hypothesizes that:

Hypothesis 2 (H2): Greater PCP will lead to a higher level of JS.

PJC and JS

PJC measures the extent to which employees believe they can influence their work environment and exert control over issues and events that impact their job (Karasek, 1979; Tangirala & Ramanujam, 2008). There are two primary rationales supporting the notion that PJC is positively associated with JS. First, the vital role of PJC in JS is attributed to basic psychological needs. Along with competency and relatedness, autonomy is considered one of the three fundamental psychological needs for human beings (Sheldon & Gunz, 2009; Van den Broeck et al., 2016). As Deci and Ryan (1987) put, “when autonomous, people experience themselves as initiators of their behavior; they select desired outcomes and choose how to achieve them” (p. 1025). Consequently, a work environment characterized as being supportive of autonomy is more likely to result in positive outcomes, including greater intrinsic motivation and satisfaction (Demircioglu, 2021; Saragih, 2015). On the other hand, a workplace that endows limited autonomy or job control to employees may bring about job strain and severely impair workers’ enjoyment at work. Second, based on the Job Demands-Resources model, job resources, including job control, can function as protective factors against job demands. The possession of these resources can bring about positive employee outcomes, such as JS (Bakker & Demerouti, 2017). Facing heavy workloads, role ambiguity, and job-related strain, frontline workers feel psychological stress. Employees can better manage these stressors if they have appropriate autonomy and control over their job (Häusser et al., 2010; Olvera & Avellaneda, 2023).

Street-level bureaucrats are usually subject to high job demands, which constitute a psychological burden for them in their professional lives (Shim et al., 2017). For example, they are often assigned with tremendous workloads while endowed with limited budgets and resources (Lipsky, 2010). Their exposure to excessive contact with and complaints from clients also aggravates this psychological tension (Grandey, 2000). Lipsky (2010) then suggests that job discretion or autonomy is critical for street-level bureaucrats to apply their expertise in carrying out their tasks and making informed decisions within a complex context. Greater job control or autonomy lowers the sense of uncertainty and insecurity at work (Jong, 2016) and enables bureaucrats to cope more effectively with stressful situations (Bakker et al., 2010; Tummers & Bekkers, 2014). Thus, this study argues that PJC may promote the JS of street-level bureaucrats.

Hypothesis 3 (H3): Street-level bureaucrats with a higher level of PJC will have higher JS.

Mediating Effects

This study aims to uncover the underlying mechanisms by which internal and external incentives affect JS, hypothesizing that both PCP and PSM can enhance JS by increasing PJC. PJC—considered a fundamental psychological need—may serve as a focal variable mediating the relationship between PSM and JS. The primary objective of the public sector is to deliver public goods and serve the public interests. Public employees who have lower levels of PSM are likely to feel themselves being pressured, constrained, or coerced when dealing with job demands and performing their duties in the interest of the public (Bakker, 2015; Liu et al., 2015). Such employees may find that the public sector’s job tasks and working conditions are less aligned with their characteristics, leading to decreased PJC.

On the contrary, public employees who are high on PSM commonly feel more “fitting in” because they perceive that their values and goals are more congruent with those of the public sector (Bright, 2008; Kim, 2012). Individuals who have characteristics that are compatible with their organization are more likely to experience a sense of control over their job and achieve high levels of performance. That is, when those employees with high PSM feel that their internal motivation and values can be acted on in an organization, their psychological needs for autonomy will be satisfied (Carpenter et al., 2012; Kim, 2012). Simply put, bureaucrats who possess elevated levels of PSM might discover a public sector role to be more fulfilling or personally resonant due to an increased perception of control and autonomy over their professional trajectory (Teo et al., 2016; Vandenabeele, 2008). In other words, PSM may enhance JS by increasing employees’ PJC in public sector work environments that meet their pro-social needs. Hence, this research hypothesizes that:

Hypothesis 4 (H4): PJC is a mediator between PSM and JS. Specifically, greater PSM will indirectly increase JS by enhancing PJC.

Researchers are debating heatedly over whether PCP has a positive or negative influence on individuals’ PJC (Houlfort et al., 2002; McCausland et al., 2005). The CET asserts that psychological needs for autonomy and self-determination are significant to individuals’ intrinsic motivation for work (Ryan & Deci, 2008). Extrinsic incentives, nonetheless, are normally perceived by employees as a form of external pressure, conveying to individuals that they need to perform up to their superiors’ standards instead of freely making their own choices (Deci & Ryan, 2000). In other words, when individuals feel that they are being compelled to behave in a certain way by external incentives, their PJC or autonomy will be undermined, which ultimately demotivates and dissatisfies them (Frey & Jegen, 2001; Gagné & Deci, 2005).

However, the argument of undermining effects has begun to be challenged by a growing body of research. A number of studies conducted in workplace settings demonstrate that PCP has a positive, rather than negative, impact on perceived autonomy (Balkin et al., 2015; Eisenberger & Aselage, 2009; Fang & Gerhart, 2012; Stazyk, 2013). Instead of exerting direct control or surveillance, a performance-contingent incentive scheme conveys that an organization is seeking to incentivize employees by aligning their on-the-job performance with pecuniary pay (Eisenberger et al., 1999). In essence, being in a position where a reward is required to motivate someone to perform exceptionally is believed to convey the idea that the person providing the reward lacks direct control over the recipient’s actions (Houlfort et al., 2002, p. 280). In fact, after setting performance standards for employees, the organization has limited substantive control over the daily activities of employees who may enjoy greater information advantage and have a better understanding of the actual working condition than their superiors (Tummers & Bekkers, 2014). Houlfort et al. (2002) further distinguish perceived autonomy between affective and decisional ones, suggesting that PCP will not exert decremental effects on employees’ decisional autonomy, namely their availability of behavioral options.

On balance, this study argues that individuals in an organization cannot be completely autonomous, meaning that they are more or less subject to various regulations and different types of incentive schemes. If there are no regulations and incentive schemes to guide employees’ behavior, they may go to another extreme and feel a loss of control and disoriented. PCP is then a compromise strategy that is less prone to triggering intensified tension among employees than direct control and surveillance while laying out a clear objective for employees (Ortega, 2009). Pryor (1985) argues that “if we have information about how to get the environment to reinforce us, then we control our environment; we are no longer at its mercy” (p. 172).

Street-level public employees are often faced with conflicting expectations from various stakeholders, which may lead to feelings of being overwhelmed and a loss of control over their job (Lipsky, 2010). By setting clear performance indicators for frontline workers, PCP prevents them from being confused or strayed under the perplexed and poly-directional working environment. Each time they meet the performance assessment and get compensation based on their merit, they will get a feeling of control over what is happening, leading to a reinforcing, pleasurable work experience. Moreover, PCP sends signals of competence and recognition, which further enhances employees’ sense of control and influence over their job (Grandey et al., 2013). Thus, this study argues that PCP tends to increase JS partly because it enhances PJC. It posits that:

Hypothesis 5 (H5): PJC is a mediator between PCP and JS. Specifically, greater PCP will indirectly increase JS by enhancing PJC.

Research Design

Data and Research Context

This study collected data from frontline public service workers who provide education and training services, administrative services, social work, and immigration services in Hong Kong. As a well-developed metropolis with soundly constructed social service schemes, Hong Kong seeks to provide people-oriented and professional services so that a caring and participative community can be built. Frontline workers provide a wide variety of social services and benefits to citizens in need. The service-oriented culture indeed makes frontline public service workers in Hong Kong an ideal sample to probe the research questions posed.

Based on the relevant literature and existing scales, a questionnaire was devised. Question items were stated in English first and then translated into traditional Chinese, which is the most commonly used written language in Hong Kong. While maintaining the core meaning, we made slight modifications to the wording and phrasing of certain question items during the translation process. This was done to ensure that the local participants find the content relatable and familiar. The translation was also double-checked by three individuals proficient in both English and Traditional Chinese. The questionnaire with items stated in both English and Traditional Chinese was subsequently administered with guaranteed anonymity to potential respondents in Hong Kong.

The research company, Dynata, was contracted to conduct an electronic survey among frontline workers in Hong Kong. Dynata is a global online sampling and digital data collection company. It maintains a sampling frame by recruiting participants through social media, websites, and direct email messages. While Dynata possesses rich sources of information, including external third-party panels, proprietary communities, and register users, it remains a hurdle for the company to conduct a probability sampling among subjects of certain characteristics in Hong Kong. Thankfully, leveraging its robust data collection capacity, Dynata enhanced sample representativeness by distributing questionnaires to frontline workers across various sectors, including administrative services, social work, education and training, and fire services. Finally, 300 frontline workers were approached, and 220 valid questionnaires were collected.

In addition, when structural equation modeling (SEM) is used, determining the sample size is the first and foremost step. There are three major rules of thumb: The first is a minimum sample size of 200 (Boomsma & Hoogland, 2001), the second is 5 or 10 observations per estimated parameter (Bentler & Chou, 1987; Grace, 2006), and the third widely accepted rule is 10 cases/observations per variable in setting a lower bound of sufficient sample size (Nunnally, 1967). The SEM model employed in this study comprises four main variables and five control variables. Regardless of which rules of thumb are applied, the sample size meets the minimal threshold.

Table 1 summarizes the demographic characteristics of these 220 frontline workers, with 40.91% being male and the remaining identifying as female. In terms of age, approximately 65.9% of them are younger than 40 years. Due to the young workforce in the sample, 55.45% of the respondents reported that they had worked in their organizations for less than 5 years. Most respondents have a high educational level, with 84.09% attaining a bachelor’s degree or above. In addition, more than half (58.64%) earn a monthly salary below HK$30,000.

Table 1.

Sample Characteristics.

Demographics	Group	Frequency	Percent
Gender expression	Male	90	40.91
Gender expression	Female	130	59.09
Age	<21	5	2.27
	21–30	58	26.36
	31–40	82	37.27
	41–50	48	21.82
	51–60	24	10.91
	>60	3	1.36
Education	High school level	20	9.09
	Associate degree	15	6.82
	Bachelor’s degree	128	58.18
	Master’s degree	53	24.09
	Doctor’s degree	4	1.82
Work tenure	<1	23	10.45
	1–2	33	15.00
	3–5	66	30.00
	6–10	47	21.36
	11–15	21	9.55
	>15	30	13.64
Monthly salary^a	≤15,000	20	9.09
	15,001–20,000	50	22.73
	20,001–25,000	30	13.64
	25,001–30,000	29	13.18
	30,001–35,000	28	12.73
	>35,000	63	28.64

Hong Kong dollars (HKD).

Main Measures

The main measures of this study are listed in the Appendix. As shown there, each variable was gauged by three to five items scoring on a 5-point Likert-type scale. In the proposed research model, the main dependent variable is JS. It was operationalized and measured by three items drawn from the seminal study by Grandey et al. (2013). These items denote how content or dissatisfied an individual is with his or her job in general. A reverse-worded item was used to reduce response bias and subsequently reverse-coded.

There are two main independent variables: PSM and PCP. To ensure that survey fatigue was avoided, this research opted for Wright and Pandey’s five-item scale of PSM instead of Perry’s (1996) 40-item scale. This shorter scale is considered more suitable for encompassing the three dimensions of commitment to public interest, compassion, and self-sacrifice, which collectively epitomize “the altruistic appeal of public sector values” (Wright & Pandey, 2008, p. 509). PCP measures the extent to which the respondents perceive their performance as closely related to payoffs in their work environment. It merits noting that this study employed the concept of PCP perceptions to gauge individuals’ overall perceptions of PCP systems. This measurement approach aligns with prior research that has examined the correlation between PCP perceptions and JS (Kim & Holzer, 2016; Park & Sturman, 2022). To uphold the validity and reliability of the measurement, this study employed the three-item scale devised by Grandey et al. (2013) to assess the degree to which pay and financial rewards are intricately linked to performance within the respondents’ organization. The mediating variable, PJC, gauges how much control respondents feel they have over work or work-related matters. This mediator was constructed from three items derived from the article by Smith et al. (1997).

An exploratory factor analysis (EFA) was first conducted to assess the validity of the primary measures employed in the study. Table 2 reports the result of the factor analysis. Factor loadings that surpass the threshold of 0.4 are highlighted in bold. As the table shows, no item appears to load heavily on latent variables other than the projected one. Item 2 of the PSM scale was dropped because of low factor loadings (less than 0.4) in the EFA, resulting in a reliable four-item construct (Cronbach’s α = 0.712). Table 2 also presents the Cronbach’s α value to showcase the reliability of the scales. With a commonly accepted cutoff value of 0.70 for Cronbach’s α (Christmann & Van Aelst, 2006), all the scales utilized in this study demonstrate satisfactory internal consistency.

Table 2.

Factor Analysis of Main Measures.

Observed variable items	Job satisfaction (JS)	Public service motivation (PSM)	Performance-contingent pay (PCP)	Perceived job control (PJC)	Uniqueness
JS1	0.863	0.153	0.116	0.151	0.195
JS2	–0.876	−0.035	0.046	0.044	0.227
JS3	0.792	0.123	0.154	0.285	0.253
PSM1	0.197	0.651	−0.167	−0.085	0.503
PSM2	0.203	0.395	−0.196	−0.084	0.757
PSM3	0.141	0.764	0.063	0.086	0.386
PSM4	0.087	0.755	0.109	0.171	0.381
PSM5	0.060	0.730	0.054	0.062	0.456
PCP1	0.144	0.051	0.812	−0.017	0.318
PCP2	0.103	−0.012	0.866	0.163	0.212
PCP3	−0.052	0.040	0.802	0.227	0.300
PJC1	0.167	0.025	0.139	0.811	0.294
PJC2	0.057	0.133	0.287	0.665	0.455
PJC3	0.142	0.081	0.081	0.794	0.336
Eigenvalue	2.268	2.361	2.157	1.916
Variance	2.325	2.315	2.269	1.979
Cronbach’s α	0.835	0.712	0.797	0.708

We controlled for the following confounding variables: gender, age, education, work tenure, and monthly salary. These variables are believed to exert an influence on JS and have been included as control variables in previous research (Breaugh et al., 2018; Bright, 2008; Green & Heywood, 2008). Gender is set as a dichotomous variable coded as male = 0 and female = 1. Age is measured across six levels: “<21 years old” = 1, “21–30” = 2, “31–40” = 3, “41–50” = 4, “51–60” = 5, and “>60” = 6. Education is treated as an ordinal variable with six levels: “high school level” = 1, “associate degree” = 2, “bachelor’s degree” = 3, “master’s degree” = 4, and “doctoral degree” = 5. Work tenure is deliberately divided into six levels: “<1 year” = 1, “1–2” = 2, “3–5” = 3, “6–10” = 4, “11–15” = 5, and “>15” = 6. Monthly income is also treated as an ordinal variable with six scales: “≤15,000 HKD” = 1, “15,001–20,000” = 2, “20,001–25,000” = 3, “25,001–30,000” = 4, “30,001–35,000” = 5, “>35,000” = 6. Table 3 presents the descriptive statistics of focal variables and their correlation. In general, the sample of 220 Hong Kong frontline workers exhibited relatively high levels of JS and PSM, as well as moderate levels of PJC and perceived contingency between performance and pay.

Table 3.

Means, Standard Deviations, and Correlation Matrix.

Observed variable items	M	SD	1	2	3	4	5	6	7	8	9
1. JS	3.512	0.778	1
2. PSM	3.420	0.617	.292***	1
3. PCP	2.895	0.906	.158*	.066	1
4. PJC	3.174	0.737	.299***	.195**	.378***	1
5. Gender	0.591	0.493	−.138*	−.021	.023	−.096	1
6. Age	3.168	1.053	.064	−.101	−.061	−.063	−.201**	1
7. Education	3.027	0.865	.024	.135*	.081	.112	−.113	.035	1
8. Work tenure	3.455	1.480	−.037	.011	−.033	.051	−.295***	.574***	.044	1
9. Monthly salary	3.836	1.767	.120	.148*	−.055	.098	−.240***	.353***	.373***	.459***	1

Note. JS = job satisfaction; PSM = public service motivation; PCP = performance-contingent pay; PJC = perceived job control.

p < .05. **p < .01. ***p < .001.

To address concerns regarding common-method variance (CMV), which can arise from self-reported questionnaire data with a cross-sectional design, Harman’s single-factor test was conducted (Tehseen et al., 2017). Specifically, a confirmatory factor analysis (CFA) on all items of key variables was conducted. The CFA yielded poor fit statistics (comparative fit index [CFI] = 0.440, Tucker–Lewis index [TLI] = 0.328, root mean square error of approximation [RMSEA] = 0.194, standardized root mean square residual [SRMR] = 0.157), which indicates that there is no single factor accounting for a majority of the total variance. As a result, the severity of common-method bias can be refuted.

In addition to using Harman’s single-factor test, this study employed the partial correlation technique to address concerns regarding CMV (Podsakoff et al., 2003). This involved parceling out a general methods factor, which accounts for the majority of the covariance among the measures. To create the general factor, a factor analysis was conducted on all survey items to extract the greatest proportion of common bias across all variables. The difference between the R² value of the endogenous constructs of JS and PJC before and after adding the general factor was calculated. A significant increase in the R² value after adding the general factor would indicate serious CMV in the study (Tehseen et al., 2017).

SmartPLS 4 was used to test the value of R². The R² value of JS before adding the general factor was 0.223, whereas the R² value of JS after adding the general factor was 0.238. It indicates no significant increase in the R² value. Similarly, the R² value of PJC before adding the general factor was 0.199, and the R² value of PJC after adding the general factor became 0.209, which also indicates no significant increase in the R² value. Therefore, the results suggest that common-method bias is not a serious threat in the study.

Findings

To examine the impacts of PSM and PCP on JS, this study performed SEM using Stata 16. Modification indices were used to optimize the model. SEM is used because of the latent nature of the dependent, independent, and mediating variables. Prior to modeling, variance inflation factors (VIFs) and cross-variable correlations were tested to guard against potential multicollinearity. The highest correlation coefficient (0.574) was between age and work tenure; all other correlations were below 0.5. The highest VIF was 1.78, and the average was 1.31, suggesting that multicollinearity was not a serious problem to inflict on the model.

The model fit was assessed using four indices: the CFI, TLI, RMSEA, and SRMR. Cutoff criteria for these indices include ≥.95 (good fit) and ≥.90 (moderate fit) for CFI and TLI, ≤.06 (good fit) and ≤.08 (moderate fit) for RMSEA, and ≤.08 (good fit) for SRMR (Hu & Bentler, 1999). Overall, the model achieved moderate fit (CFI = .926, TLI = .904, RSMEA = .073, and SRMR = .065).

There is no denying that reverse causality is a common issue in cross-sectional designs in SEM. Fortunately, as Byrne (1994, p. 21) noted, “If the goodness of fit is adequate, the model argues for the plausibility of postulated relations among variables.” Therefore, the good fit of the model supports the directionality specifications to some extent. In addition, providing cogent and reasoned justifications for directionality specifications is a major way to address the problem of reverse causality in cross-sectional SEM designs (Kline, 2023). This study formulated its hypotheses on logical inferences and existing literature. Although reverse causality might be technically feasible for certain variables, the proposed framework is undeniably more plausible and holds academic significance. Figure 2 provides a graphical representation of the SEM graphical output.

Figure 2.

Graphical Representation of Structural Equation Modeling Results.

Table 4 demonstrates the direct and indirect effects of independent variables on JS. This study first tested the mediating effects of PJC on main relationships using a three-step procedure (Zhao et al., 2010). The first step is that the dependent variable (JS) should be related to the independent variables (PSM and PCP). The second step tests whether the explanatory variables (PSM and PCP) are correlated with the mediator (PJC). In the third step, the independent predictors and the mediator are included together in the regression equation. In this step, after the inclusion of a mediator, if the effect of the independent variable on the dependent variable is reduced in its absolute size but still achieves statistical significance, it presents partial mediation. However, if the effect of the independent variable on the dependent variable becomes insignificant, it indicates that a full mediation effect is at play.

Table 4.

Results of Structural Equation Modeling.

Observed variable items	Step 1Total effects on JS	Step 2Effects on PJC	Step 3Direct effects on JS	Indirect effects on JS via PJC
Independent variables
PSM	0.360 (0.073)***	0.193 (0.079)**	0.304 (0.0756)***	0.057
PCP	0.209 (0.071)***	0.437 (0.084)***	0.082 (0.084)	0.131
Mediator
PJC			0.300 (0.091)***
Controls
Gender	−0.138 (0.069)**	−0.073 (0.077)	−0.119 (0.068)*
Age	0.143 (0.081)*	−0.135 (0.090)	0.186 (0.080)**
Education	−0.051 (0.073)	0.038 (0.079)	−0.066 (0.071)
Work tenure	−0.247 (0.085)***	0.075 (0.096)	−0.268 (0.083)***
Monthly salary	0.126 (0.082)*	0.103 (0.090)	0.104 (0.081)

Note. JS = job satisfaction; PJC = perceived job control; PSM = public service motivation; PCP = performance-contingent pay.

p < .05. **p < .01. ***p < .001.

In Table 4, the first column presents the total effects of PSM and PCP on JS. It shows that both PSM (β = 0.360, p < .01) and PCP (β = 0.209, p < .01) positively and significantly affect JS, which supports H1 and H2. The results also indicate that PSM carries a more relative weight than PCP in terms of affecting public employees’ JS. The second column demonstrates the slope coefficients of PSM and PCP on the PJC. In line with H4 and H5, both PSM (β = 0.193, p < .05) and PCP (β = 0.437, p < .01) significantly improve PJC. The results in the third column show the coefficients of PSM and PCP on JS after PJC is included in the model. It turns out that PJC exerts positive and statistically significant effects on JS (β = 0.437, p < .01), supporting H3.

As shown in the third column, while PSM still wields significant effects on JS after the mediator PJC is introduced (β = 0.304, p < .01), the absolute size of this effect drops from 0.360 to 0.304. Thus, PJC partially mediates the relationship between PSM and JS, corroborating H4. Subsequently, this study employed the Sobel test to assess the statistical significance of this mediation effect (Zhao et al., 2010). The results indicate that z = 1.963 (p < .05). In this regard, the mediation effect is indeed significant. However, it must be noted that after PJC is included in the model, the effect of PCP on JS drops from 0.209 to 0.082 and becomes insignificant. Thus, PJC functions as a full mediator in the relationship between contingent pay and JS, supporting H5. The Sobel test in this scenario yielded a significant result with z = 2.785 (p < .01).

The fourth column in Table 4 calculates the indirect effects of independent variables on JS via PJC. Noteworthily, the findings reveal that the indirect effect of PSM on JS through PJC amounts to 0.058 (0.193 × 0.3), accounting for 16.08% of the total effect (0.058/0.360). This suggests that PJC acts as a partial mediator between PSM and JS, leaving room for the possibility of additional mediators.

Conclusions and Discussions

This study investigates the impact of PCP and PSM on the JS of street-level bureaucrats. Three major findings are identified. To begin with, both PSM and PCP are significantly correlated to JS. The existing literature normally focuses on the crowding-out effect of PCP on PSM while neglecting that extrinsic incentives and intrinsic motivation may take a dual-track approach in simultaneously increasing JS.

In addition, PJC serves as a common denominator that mediates the effects of both PCP and PSM on JS. In hindsight, this finding makes sense as the PJC is indeed a prominent predictor of JS for street-level bureaucrats who oftentimes face exigent job demands and need an adequate level of autonomy to deal with the complicated working environment and job stressors. PCP contributes to an enhanced perception of job control by providing clear performance standards, without directly imposing surveillance or limiting employees’ decision-making options. The attainment of intrinsic enjoyment may also help to convey a sense of competency and control over jobs. Likewise, street-level bureaucrats with stronger PSM are more likely to perceive a higher sense of job control in the public sector owing to the alignment of personal and organizational values and ideologies.

Third, the total effect of PSM on JS (16.08%) is larger than the total effect of PCP on JS (0.437 × 0.3 = 13.1%). This is because the impact of PCP on JS is fully mediated by PJC, whereas PJC only partially mediates the relationship between PSM and JS. In short, compared with PCP, PSM is more important to the JS of street-level bureaucrats in Hong Kong. While frontline workers may be incentivized by PCP, their initial attraction to the public sector is primarily driven by their intrinsic pro-social motivation. Without this intrinsic motivation, it would be challenging for them to find true JS, given the competing demands and stressful interactions they encounter while serving the public.

Although this research was conducted in the Hong Kong context, its analysis of the street-level bureaucrats can be generalizable to different settings as the characteristics of frontline workers in Hong Kong bear a resemblance to Lipsky (2010)’s depiction of their counterparts in Western countries. For one, this study proposes a dual-track approach to unveil the positive impacts of both extrinsic contingent pay and intrinsic PSM on JS. Burgeoning research advocates that it is time to move beyond the undermining effect of extrinsic incentives on intrinsic motivation because it may obfuscate the importance of extrinsic motivation to work-related outcomes (Cerasoli et al., 2014; Reiss, 2005). This study further advances this line of inquiry by demonstrating that PCP and PSM foster JS through distinct pathways. Moreover, it highlights that PSM exerts a more pronounced and direct impact on JS among street-level bureaucrats than PCP.

Furthermore, this study identifies the significant role of PJC for the psychological well-being of frontline public service workers, resonating with a branch of the literature on street-level bureaucrats. A large volume of studies have indicated that PJC may effectively mitigate street-level bureaucrats’ psychological strain caused by overwhelming job demands. A higher level of job control enables street-level bureaucrats to make the most of their expertise and rich experience in dealing with demanding work pressure and multiple expectations. This study indeed affirms this strand of inquiries and show that both PCP and PSM can improve PJC.

Last but not least, this study speaks to the CET. Different from what CET suggests, this study argues that PCP increases instead of undermining the PJC. PCP promotes PJC by clearly stating primary working goals without imposing direct control and surveillance. Distinct from laboratory contexts, in real-world workplaces that are inherently complex and filled with infighting, an utter absence of regulations and standards will not give individuals a sense of autonomy but a feeling of confusion and disorder. PCP, to a certain extent, offers employees concrete goals and directions without impairing their decisional autonomy. Thus, this study enriches a growing, yet still scattered, literature that supports the positive effect of PCP on job autonomy/control (Eisenberger et al., 1999; Houlfort et al., 2002).

On a practical level, this study shows the critical importance of guaranteeing street-level bureaucrats’ PJC in job design. Street-level bureaucrats are commonly expected to be responsive to top-down directives and meet bottom-up expectations at the same time. Thus, they need to be endowed with more discretionary power to cope with tremendous amount of workload and pressure. In their job characteristic model, Hackman and Oldham (1976) consider autonomy as one of five core job dimensions and explicitly relate work autonomy with workplace health and well-being. Inspired by the findings of this article, this study thus calls for a more exquisite design of extrinsic incentive schemes that convey support and recognition rather than imposing control and limiting the emotional and decisional autonomy of public employees.

It has also become apparent that the role PSM plays in deciding the JS of street-level bureaucrats is prominent. Continuously engaging in face-to-face encounters with the public may impose significant emotional and physical demands on frontline workers, which can lead to burnout and demotivation. However, PSM enables street-level bureaucrats to overcome these challenges and derive enjoyment from their interactions with citizens. On this note, public managers should nurture the pro-social motivation of street-level bureaucrats, ensuring that their values and goals are as closely compatible as possible with those held by public organizations. Furthermore, it is imperative to provide street-level bureaucrats with adequate support, especially in mental- and resource-related aspects, to sustain their PSM and passion to serve the public at full tilt.

This study represents an initial endeavor to examine the dual-track effects of extrinsic incentives and intrinsic motivation on the JS of street-level bureaucrats. Given its focus on a single region and the inherent limitations of cross-sectional designs, this research opens the door for future investigations in this area. Like-minded scholars ought to expound the intricate mechanisms between PSM, pay for performance, and JS in different cultural contexts with larger samples. As the public sector increasingly adopts extrinsic interventions on employees, it is of pragmatic usefulness that future studies shift from fixating on the crowding-out effects of extrinsic constraints on intrinsic motivation and march toward unpacking more complex and subtle mechanisms among various forms of extrinsic controls, intrinsic motivation, and performance-related outcomes.

Footnotes

Appendix

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was partially supported by the General Research Fund allotted by the Research Grants Council of Hong Kong (project no.: 9043097) and by the National Natural Science Foundation of China (project nos.: 72004189, 72304069).

ORCID iD

Bo Wen

Chih-Wei Hsieh

Data Availability Statement

The data used or mentioned to support the opinions expressed in this article are available upon reasonable request.

Author Biographies

Wenyan Tu is an assistant professor at the Institute for Global Public Policy, Fudan University. Her major research interests cover corruption, integrity management, and bureaucratic behavior. She has published articles in Public Management Review, The China Quarterly, and Asian Journal of Social Psychology.

Chih-Wei Hsieh is an associate professor in the Department of Public and International Affairs at the City University of Hong Kong. His research interests focus on public service delivery, human resource management, and organizational behavior. He has published articles on emotional labor, public service motivation, and workplace diversity.

Chung-An Chen is an associate professor in the Public Policy and Global Affairs Program, Nanyang Technological University, Singapore. He has a broad interest in public management issues with a particular focus on organizational behavior and human resource management.

Bo Wen is an associate professor in the Department of Government and Public Administration at the University of Macau. His primary areas of study are public human resource management, organization theory and behavior, institutional analysis, policy implementation, regulatory governance, and Chinese politics. His work appears in Public Administration Review, The China Quarterly, Journal of Contemporary China, The American Review of Public Administration, International Public Management Journal, among others.

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